There were sharp declines last week across the cryptocurrency market with many analysts anticipating returns to sub-$6,000 levels for Bitcoin. Prices this week have recorded more bullish movements with consecutive daily gains in a large number of assets. Many assets are also forming higher lows which may be indicating the start of an uptrend.
The total cryptocurrency market capitalisation is around $217 Billion which is approximately a 10% increase over the past seven days. During the week, the market capitalisation dropped near a yearly low close to $190 Billion but has managed to return back above the $200 Billion mark with these recent appreciations. Bitcoin dominance is approximately 53%. The dominance was closer to 30% in early 2018 but the dominance has risen with Bitcoin holding it’s fiat value much better than altcoins.
Going forward, it is a strong sign that cryptocurrencies have been recording large appreciations, especially amid many analysts anticipating doomsday scenarios. However, there will be many tests ahead if the price continues to rise. These challenges will be noted in the price analysis.
Key News Developments:
ETF Decision Deadline Extended for the Second Time
The U.S. Securities and Exchange Commission (SEC) appears to be seriously considering the VanEck-SolidX ETF proposal. The SEC has previously rejected numerous applications from entities including Gemini, ProShares, and Direxion. Previous reasons for rejecting proposals included concerns over market manipulation and the backing of the ETF with Bitcoin Futures. VanEck-SolidX proposes to back the ETF with actual Bitcoin and this is the second time the deadline for a decision has been extended. The initial extension put the deadline to the 30th of September. This most recent extension moves the deadline all the way to the 29th of December. Is 2018 going to be the year that we finally see a Bitcoin ETF?
RippleNet is now operating in 40 countries across six continents
The world bank anticipates that the global market for remittances will be $642 Billion for 2018. Ripple’s vision is the “internet of value” where money can move as quickly and as freely as information. This vision aims to change the remittances landscape as we know it. Ripple’s flagship product, RippleNet, is a network that payment providers and financial institutions connect to. The backbone of the RippleNet is the Interledger protocol which facilitates fast and secure payments on a connected ledger. Ripple’s token, XRP, has been one of the best performers of the top 100 cryptocurrencies by market capitalisation this week.
Bitfinex launches decentralized trading platform for Ether
Centralized exchanges go against the trustless ethos cryptocurrencies is based on. By using a centralized exchange, you are placing your funds in the control of a third party and this was one of the core problems cryptocurrencies were developed to solve. However, centralized exchanges are often used by those wishing to speculate on the value of cryptocurrencies. Bitfinex is taking a step in providing users with the best of both worlds by launching its decentralized trading platform, Ethfinex Trustless. Ethfinex Trustless aims to provide traders with the benefits of a decentralized system where users gain more security and control of their funds while maintaining the ability to speculate on the movement of assets.
Bitcoin Price Analysis
Price and RSI have been forming higher highs and higher lows this week in Bitcoin. The price appreciations have been on significant volume showing there is some strength behind the move. MACD is also converging towards the centerline showing that momentum is starting to shift more towards the buyers.
Regardless of all these bullish signs, the key thing for traders and investors to monitor in terms of fiat price is the descending triangle pattern which has been forming since January. Price action has approached the downward trendline of the descending triangle pattern six times since January and it has been respected each time. We are approaching the end of this pattern and the price either needs to break through the downward trendline to the upside or price is likely to see a sharp fall below $6,000. In the case that price sees a sharp fall below, the $6,000 mark is likely to change from significant support to significant resistance.
Ether Price Analysis
The price of Ether has undergone a much more bearish year than many other cryptocurrencies. Even when the prices of other cryptocurrencies and Bitcoin was rising during the year, Ether often continued its downward spiral. Only two weeks ago, TechCrunch published an article predicting that the price of Ether is on a trajectory towards zero.
A key level for Ether over the past few weeks was the $270 price level. This is the point where price started increasing exponentially last November. This level held as support for some while but eventually broke down with a sharp sell-off. After the fall below this point, it was difficult for analysts to say where the price decline was going to stop and price continued to even fall below the $200 mark.
Since this time, the price action of Ether has started recording more bullish technicals. Price has returned above the $200 mark with significant daily gains in the double digits. Price has been forming higher highs and higher lows along with RSI, the sign of the start of an uptrend. MACD has also been converging towards the centerline indicating momentum is shifting towards the buyers. It is difficult to say whether Ether price is after bottoming out for the year. A sell-off across the market will likely lead Ether to return to its yearly lows. In the case of price continuing to rise, resistance is to be anticipated near $270. The 50 EMA is also approaching this point which could serve to be additional resistance.
“Altcoin of the Week” Price Analysis- XRP
The value of Ripple’s token, XRP, is close to doubling in price this week. The bullish movements began with the announcement of RippleNet being operational in forty countries. The surprising aspect of this is that XRP has little to do with RippleNet. RippleNet is part of Ripple’s xVia service which aims to connect financial institutions and payment providers and facilitate payments through the interledger protocol. XRP can be used for this but it is not required.
XRP is more linked towards Ripple’s xRapid solution. xRapid is a low-cost liquidity solution aimed at emerging markets. However, it is not uncommon for the price of XRP to surge on positive announcements related to Ripple’s other services.
The price of XRP has surged above it’s daily 50, 100, and 200 EMA. The MACD has crossed its centerline to the upside and momentum is currently completely on the side of the buyers. The total market capitalisation of the XRP token has moved above $20 Billion after starting the week close to $11 Billion.
The key challenge to price action in the near future is the descending triangle pattern which has been in play since January in Bitcoin. With Bitcoin’s dominance at 53%, it is very much the market leader and the movements of a lot of the market will depend on it. A return to bearish movements in Bitcoin will likely mean bearish movements across the market as a whole.
After a bullish week, the price of bitcoin is approaching the downward trend line of the descending triangle for the seventh time. A failure to break through it makes it more likely that we will see returns to below $6,000 for Bitcoin.
News announcements have been positive for the past week and the SEC appears to be deeply considering the ETF proposal by VanEck-SolidX. The approval of this ETF by year end will likely have a huge positive impact on price after so much anticipation and discussion about ETFs over the past year.